Succession planning is a management process that, when executed effectively, ensures that employees are properly recruited and developed so that they have the skills and experience necessary to step up and fill a key role within the company when the time is right. You need only to follow the NBA playoffs to see this concept in practice. The teams that consistently advance are those that manage to maintain a strong bench, with talented and proven players available to substitute for every starter.
Succession planning has become a hot HR management topic of late. Where it was once reserved for only the most senior positions within a company, today succession planning transcends all levels within an organization. The reason, in part, is that with so many baby boomers on the brink of retirement, a void of seasoned managers waiting in the wings could threaten the sustainability of some businesses.
A successful succession planning process should incorporate six key elements: 1. strategic planning; 2. recruiting and retention; 3. employee development; 4. performance management; 5. talent assessment, and 6. technology.
Strategic Planning
Before it can be decided how best to fill key positions down the road, a company must first determine where it anticipates being in the future. HR and mid-level executives cannot do this in a vacuum. It is imperative that top executives remain involved in the succession planning process. Their input is essential in defining the company’s direction and what roles will be critical in the future.
Recruiting & Retention
Succession planning and recruiting are closely intertwined. It probably goes without saying that companies must hire the right skill set to fill their short term needs, but they must also consider whether an applicant has the required aptitude and mind set to meet the company’s longer term objectives. When there is a pipeline full of capable employees ready to step up, it becomes much easier to promote from within when an opportunity arises. Proactive succession planning also contributes positively to retention. When employees know that they are earmarked for bigger things within the company and that there is a plan for their career development, they are far more likely to remain committed to the company and be on board when it comes time for them to take the helm.
Employee Development
The purpose behind succession planning is to prepare employees for advancement or promotion into evermore challenging roles within an organization. That cannot happen unless a company is committed to providing the development opportunities an employee needs to grow professionally. Best practice firms emphasize the importance of individualized development plans that focus on the specific needs of each employee. Beyond the mere fundamentals of training and development, more advanced employee development incorporates special assignments, action learning and executive coaching programs.
Performance Management
Performance management is a critical aspect of succession planning. Regularly evaluating the performance of employees in their current job helps companies identify individuals’ strengths and weaknesses as well as areas for further development. It also allows companies to objectively measure employees’ performance relative to their peers. How else can a company distinguish true rising stars from those who are perhaps best left where they are? After all, not every employee is cut out to advance into a management role - some have neither the ability nor the aspiration to lead.
Talent Assessment
Talent assessment takes performance management to the next level. Often conducted in conjunction with an annual performance evaluation process, talent assessments allow companies to gauge their team’s bench strength at a precise moment in time. Such assessments answer the question, “do we have who we need?” By regularly taking a qualitative measurement of individuals’ skills and leadership readiness (in addition to how they are performing in their current jobs), companies can constructively address areas of weakness or concern and keep employees focused on their career paths and the roles they are being groomed to fill. Moreover, talent assessments compel companies to anticipate their next move, so when an unexpected departure or a business change occurs, the company is prepared to react and reassign an individual or redeploy groups of employees quickly.
Technology
As with most business processes, advanced technology now exists to help companies with succession planning by streamlining performance evaluations as well as talent assessments. Succession planning programs can even execute models to identify which employees are most ready to be promoted or moved into new roles. For larger companies, such technology can be extremely useful to maintain organization and increase efficiencies. For smaller companies, where owners or top managers still know most of their employees, sophisticated technology might seem unnecessary, but it may actually prove to be even more useful. Such technology can help business owners maintain a degree of objectivity when family ties, personal friendships, or emotions might otherwise sway their decision making.
One last, but very important, note to add on the topic of succession planning is this – when a company implements succession planning, it should establish a continuous and ongoing process, not just devise a rigid and stagnant plan. Too often senior managers develop a “plan” and then effectively put it in the vault, somehow convincing themselves that their plan will still be applicable when the time comes to enact it – usually when one of them decides to retire. Chances are, however, that by then several of their handpicked successors will have scattered, especially if those talented understudies never even knew they were being considered for the job.
Succession planning has to be a fluid process that not only tracks the talent and development of employees, but also includes them in the process. By illustrating a potential career path and allowing employees to weigh in on the course their path ultimately takes, companies demonstrate their commitment to top performers and help ensure those talented team members are on the bench, suited up, and ready to take the court.
